Expert Predicts A Fifth Wave Can Drop XRP’s Price To $0.35

Seasoned investment trader and CEO of AI Crypto Ratings Resource Evai, Matthew Dixon, shared an XRP analysis on X recently based on the Elliot Wave Theory. 

The Elliot Wave Theory is a technical analysis technique focusing on long-term price patterns. These patterns result from investor sentiments and trading psychology. 

Also, the Elliot Wave shows five waves moving in the direction of the price trend and three waves in the opposite direction. 

Dixon’s analysis focused on a five-wave structure that XRP has remained in since mid-July after its victory in the SEC lawsuit. He also pointed out that the charts indicate that XRP correlates with Bitcoin’s price outlook. 

According to the CEO of Evai, Matthew Dixon, XRP completed the first wave when it increased by 73% to $0.94 on July 13. However, XRP dipped by 11.95% after the 73% spike to touch a low of $0.67 to form Wave 1.

Looking across #assets we see #XRP aligned with the #BTC outlook.
Bearish divergence indicates that 5th wave down should come soon although we MAY see a tip higher to complete wave 4.
Nothing certain in TA but this is a high % probability imo#Evai pic.twitter.com/CrAewt4ZtU

— Matthew Dixon – CEO Evai (@mdtrade) October 8, 2023

The second wave formed a few days after the first wave when XRP attempted a recovery following the drop to $0.67. Due to the slight recovery, XRP rose to $0.85, completing the second wave. However, XRP succumbed to selling pressure after rising to $0.85, leading to a retracement from July 13. 

XRP’s price dipped from $0.85 on July 20 to $0.42 on August 17. The dip represents a 50% decline for the asset in one month, completing Wave 3. Then, after XRP’s recovery from the $0.4226 low, it traded in the $0.46 to $0.55 range staying above $0.45. 

However, Dixon expects XRP to complete wave 4 during an upcoming price surge that will send it above $0.55. In his analysis, Dixon is bullish on the next rally and states it might exceed $0.55.

However, he believes a major price decline will occur for XRP after the surge. 

Meanwhile, he noted a bearish divergence pattern formed by XRP’s Relative Strength Index (RSI). This bearish pattern suggests that XRP’s bullish momentum is weakening, and a decline could occur soon. 

XRP’s Daily Chart Analysis Today Hints at Possible Decline 

XRP is in a downtrend on the daily chart, forming a fourth red consecutive candle as the sellers dominate. XRP’s decline began after encountering resistance at the $0.55 price level. Although XRP is approaching the $0.49 support level, the sellers will likely drive its price below, leading to further decline. 

Notably, XRP dropped below the $0.49 support on September 11 before rallying between September 12-15 to break above it. However, the sellers are now controlling its price, with the lower wick of yesterday’s candle dropping to $0.45. 

Also, the Relative Strength Index (RSI) indicator is dropping to the oversold region below 30 and displays a value of 42. Furthermore, the Elliot Wave Oscillator (EWO) shows a fading bullish sentiment, suggesting a retracement ahead. 

Based on XRP’s past price action, it will likely retrace below the $0.49 support in the coming days to enter the oversold region. However, a recovery after this retracement is still possible in the coming weeks.